Vodafone Group confirmed today it will buy a 34.5 per cent stake in Mexico's second-largest mobile phone operator Iusacell for $973.4 million, marking its entry into Latin America.
The world's biggest wireless telecoms company - which recently bought Eircell from eircom - will continue its recent acquisition blitz by paying for the stake in cash, underlining the strength of its balance sheet relative to the debt-laden telecoms industry.
The firm bought Eircell in a euro 4.5 billion (£3.5 billion) deal on December 21st last year.
Mr William Keever, president of Vodafone Americas Asia Inc, said of the Mexican move: "This is a significant investment as it marks Vodafone's entry into the Latin American market and a continuation of our global expansion strategy."
With only 2.2 per cent company subscriber penetration in its four cellular regions, Iusacell represents an extraordinary growth opportunity for Vodafone.
Iusacell said on Friday Vodafone would buy its stake from Grupo Peralta. Vodafone will have a smaller stake than Verizon Communications, the biggest local telephone company in the United States, which owns a 37 per cent controlling stake in Iusacell.
Mexico's fast-growing 11-million mobile phone market is hotly contested by major global telecoms players such as Telefonica, former Mexican state monopoly Telefonos de Mexico and Verizon.
Iusacell had some 1.5 million subscribers as of June and operates primarily in central Mexico.
The sale, which Vodafone expects to complete in the first quarter of this year, must be approved by Mexican competition authorities.
Reuters